Declare February 2013 as your “no frivolous spending” month!

pocket-changeHave you ever thought about giving up extraneous or frivolous spending for a month? Buzz McClain wrote an article for the Star-Telegram in 2010 detailing how his family took on such a challenge.

With the upcoming Military Saves Week, February 25 through March 1, I decided to try this myself. I got it into my head, and then got my kid on board, with the idea of going the entire month of February without spending any money other than what we’d regularly spend on food, gas, shelter and medical expenses.

“What about DS games and Happy Meals?” my 8-year old asked.

“Nope, not gonna happen between 1 and 28 February, “ I responded. “I’ll pack a lunch every day so I don’t have to buy a sandwich at work,” I also stated. “You want us to take a vacation to Atlantis resort, right? Then this will help us save some money to allow us to get there before you turn 20!” This was the comment that really got my son hooked on this challenge.

Buzz McClain wrote:

“Deep down I know slapping the wallet shut is an extreme way to rein in spending. There are easier, wiser and less draconian methods — Come on, no movies? — to help feel better about household expenses.”

“Conducting research offered by more than a dozen economic experts around the country regarding this one question: What’s the ONE piece of advice you would give a family to put on its to-do list for the coming year to promote and protect its finances?”

Below are 13 suggestions for 2013. Some of you may know these things, but finances and spending are a habit. And sometimes it may be good to be reminded to break some of the bad habit patterns.

1. Create a budget: It may not sound exciting, but it is the No. 1, sure-fire way to get finances in order and to save,” says Kevin Gallegos, vice president of Freedom Dept Relief, LLC. in San Mateo, Calif. “The key is to set goals — and if you’re in a relationship and/or have a family, do so with your significant others.   Write down the goal and build your budget with it in mind.” This is a way to take charge of your money; with the results, you’ll be able to use your money to your best advantage.

Make an appointment for a personal financial counseling session at the Ellsworth AFB Airman & Family Readiness Center or download our budget spreadsheet and complete a budget yourself. Visit our Setting up a Financial Appointment page for more information.

2. Track your spending: That’s the result of a survey of more than 100 CEOs polled by the National Foundation for Credit Counseling . “The only way you can know where your hard-earned money is going is to write down every cent you spend,” it concluded. “Do this for at least 30 days. Many people make incomes adequate to support their expenses but end up short each month simply because they don’t keep track of their spending.”

If you don’t already, do a monthly review of your bank statement; include your significant other!

3. Use cash for discretionary purchases: For things like drinks, snacks, entertainment and low-cost dining, pay cash, says Bryan Link, CEO of SimpliFi, a household financial advice Web site . “Studies have shown that we have a harder time parting with cash, so if you force yourself to use cash for these purchases, you will spend less,” he points out.  “Even better, use the ‘envelope method’ in conjunction with your monthly spending plan for these purchases. It works like this: Budget a specific weekly amount of cash for these purchases, then each week, withdraw that amount, put it in an envelope, and only use what’s in the envelope for that week.  When the cash is gone, no more spending until the next installment.”

4. Become a “Two Minute Rule Shopper: This comes from the American Institute of Certified Public Accountants. If you want to buy something not in the budget, walk away from it for two minutes. You likely will leave the impulse behind and enter the land of reason. See for more tips.

5. For purchases over $100, become a ’24 Hour Shopper’: “If you still want it the next day, go back and buy it,” says Marcia Brixey, author of The Money Therapist: A Woman’s Guide to Creating a Healthy Financial Life.  “Most of the time you’ll forget what it was by the next day.  Further, “before making a purchase ask yourself: ‘Do I really need this? Do I really want this? Will I use this? Am I buying this just because it’s on sale? How many hours will I have to work to pay for this? Do I really love this?’ I call this the Checkout Checklist.”

6. And if you can’t walk away from sales, learn from your mistakes: “Consider your money-management activities throughout the past year,” says Clarky Davis, aka The Debt Diva, . “What would you change about how you spent or saved your money? Are there clothes still hanging in your closet with tags? Did you by a new piece of equipment or electronics for your home that you never use? Did you spend an absurd about of money on overdraft fees? Recognizing your mistakes will help avoid repeating them.” But also consider what you did right: “Did you build your savings account? Are you cutting back on your expenses and streamlining your life? Think about how to keep up your good work and further improve your money-management habits in 2010.”

7. Get miles or cash by using cards: “Using these cards [with loyalty incentives] within your budget — and paying them off immediately — can get you a good chunk of change by the end of the year and can even help you achieve a vacation goal,” say the counselors at GreenPath Debt Solutions, a Michigan-based nonprofit consumer credit service, . To assure you pay them off and not carry the debt from month to month, send the payments for each card through your bank’s Internet bill pay service.

8. Save stamps — and greenhouse gases by paying bills online: If your household pays 10 bills every month, you can save $50 a year on stamps alone, say the folks behind  . Additionally, if you pay 10 bills online every month, you reduce 151 pounds of greenhouse gases, prevent 37 pounds of wastewater from being distributed into lakes, streams and rivers and save 4 pounds of paper. Calculate your household savings with the Web site’s Green Savings Calculator

9. Set up an emergency fund and have easy access to it: Phillis Sax Pilvinis, founder and president of Phoenix’s PSP & Associates , explains: “Our economy changed instantly from 2008 to 2009 — many Americans lost their jobs, homes and so on. This is why having an emergency fund is crucial. In the event the unexpected happens to you, whether employment, health related, whatever it may be, if you have at least six month’s worth of living expenses in a savings account, you not only have breathing room for an unforeseen expense, but you also have a buffer in the event you lose your job.”

10. Keep a calendar of your financial plans: Access “Your Ultimate January 2013 Financial Calendar” from

11. Change your withholdings at work: People mistakenly look at a tax refund as an easy way to save money, but really, you are just loaning the government a chunk of change instead of receiving interest on your money,” points out Roni Lynn Deutch, aka The Tax Lady and author of The Tax Lady’s Guide to Beating the IRS — and Saving Big Bucks on Your Taxes.  “Exercise self-discipline or have the money automatically transferred to a savings account; both options are much better than voluntarily loaning your money to Uncle Sam.”

One of the most common issues we see at the Airman & Family Readiness Center during financial appointments is that individuals have the wrong federal withholding. It is printed on your LES each month, check and see if you can change it to make your money work for you.

12. Contribute the maximum to your retirement: This advice comes from Alan Skrainka, chief market strategist for St. Louis, MO., investment firm Edward Jones . “Write a check to your IRA each time you get paid.” Similarly, “boost your TSP or 401(k) contributions this year — and every year thereafter. When your salary goes up, increase your contributions.”

13. Share the wealth:  “If you see your financial future come into focus, share your story with those around you,” suggest the folks at GreenPath. Additionally, Randy Brown, founder and “chief wealth strategist” of Briteline Wealth Management,  in Fullerton, Calif., says, “With interest rates low, there are innovative ways to gift assets using Grantor Retained Annuity Trusts (GRATs). GRATs are a financial instrument used to make large financial gifts without paying a U.S. gift tax. There are other things to take advantage of, such as low-interest-rate loans to your children. Work with your financial adviser to see if any of these options or others will work for you and your family.”

Join the Savings Movement during the 2013 Military Saves Week campaign!  The AFRC will be hosting a daily lunch-time financial seminar at the Deployment Processing Center, Feb 25th through March 1st.  No registration required, free lunch for the first 25 participants, view the complete list of presentations at the Ellsworth AFB Facebook page events tab.

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